Back in 2002, following serious flooding in parts of Glasgow’s East End, one of the list MSP’s for the city called on the Scottish Executive (as it was then known) to provide financial help for washed-out householders on the basis that around 80 per cent of those affected were on benefits and could not afford (home contents) insurance.
The event received substantial television coverage at the time and, yes, the flooding was indeed serious. But quite apart from the high-water levels one other thing was noticeable: the forest of satellite dishes attached to affected properties.
Of course, it should not have been inferred that every householder displayed a preference for satellite dishes over home contents cover but it was clearly more than just one or two.
So this raised the question as to why Scottish taxpayers who did the responsible thing and paid for their own home contents insurance should bail out those for whom access to the latest sporting events and movie channels on Sky was a greater priority.
For anyone who believes in personal responsibility, the reply would be: “Of course they shouldn’t.”
Home contents insurance is not just a means of compensating for the loss of material household items such as carpets and sofas; it has a personal liability clause which also covers the policyholder for injury to another person, or loss to that person’s property. So in some respects it is also a societal thing.
Yet in the Budget just delivered, George Osborne once again raised the standard rate on insurance premium tax, admittedly by a modest 0.5 per cent but it came on top of his action in more than doubling the rate of the tax last November – from 6pc to 9.5pc.
For the avoidance of doubt, the statistics above are not highlighted in support of the insurance industry which continues to baffle the public with its Byzantine lists of policy exemptions and excesses and who will simply pass on the additional costs to customers.
So those paying the price will be policyholders who, after some grumbling, will pay up because staying insured is what responsible families do.
Mr Osborne claims that the additional funds raised will be ring-fenced to pay for additional flood prevention measures following the recent mid-winter deluges which so badly affected Aberdeenshire, Cumbria and Yorkshire.
Maybe so but rather than clobber insurance policyholders, a better way forward would be to transfer the money wasted by government on the multi-billion pound, self-serving ‘climate change’ industry to a massive series of capital projects that would more or less end the fear of serious flooding for most of the population.
This, surely, would be more effective than the present situation whereby compensation is paid to wind-farm operators whenever turbines are shut down whenever…..ahem…..it becomes too windy.
Now for the good bits
To be fair to Mr Osborne, the Budget was mainly good for strivers, particularly his decision to raise the cut-off point for the 40pc tax rate from £43,000 to £45,000.
This will mean an additional £400 a year for anyone earning £45,000 and above and, according to a well-briefed Treasury minister appearing on BBC Scotland on the night of the Budget, take 14,000 Scots employees out of higher-rate tax altogether.
But for Stewart Hosie MP, the SNP’s deputy leader, this was an incentive that the Scottish Government – which will be in charge of income tax from April next year – would not be inclined to follow, muttering about how Mr Osborne’s tax changes had hit the poor and vulnerable while giving a boost to the “better off”. (Try telling someone on £45,000 with a mortgage, child-care expenses and trying to save for a pension they are ‘better off’ and you can easily imagine the reaction)
On camera, Mr Hosie was even more po-faced than normal as the chancellor has clearly set out a challenge for the SNP, especially with the Holyrood elections looming.
Should Mr Osborne achieve his aim of pushing up the level at which higher rate tax starts to be paid to £50,000 by 2020 and an SNP government restricts any rise only to the rate of inflation, then the take home pay of someone earning £50,000 in Scotland could be more than £1,200 a year less than an equivalent-earner in England.
Ian Murray, Labour’s sole remaining MP in Scotland, was also dismissive of the tax break, suggesting that the money should be retained by government and invested in “fighting austerity”. Hmm.
Some might take the view that the best way of fighting austerity would be permitting workers to retain as much of their gross earnings as possible, thus enabling them to spend more and so generate more economic activity.
There is, of course, an argument for saying that the money reimbursed to higher-rate taxpayers should be retained by the Treasury and put to use for the benefit of wider society.
But given government propensity for waste, does anyone really believe that putting the £400 a year into people’s pockets to spend as they choose is not the better option?
Mr Osborne’s decision to save £1.3 billion a year on disability payments was manna from heaven for opposition parties in propaganda terms, which must have tasted even better with the resignation of the Works and Pensions Secretary, Iain Duncan Smith, on the basis that the latest proposed legislation was a step too far.
Certainly, given that box-ticking is so integral to the benefits system it is inevitable that some claimants who deserve the retention of financial support will be adversely affected if the proposals are passed.
On the other hand, going back to the Blair-Brown years, one recalls how common it had become to see, on our High Streets, apparently agile individuals carrying lightweight, aluminium sticks but which were clearly unnecessary for walking support.
Since the defeat of the Labour government in 2010, such sights have become less common.
Leaving aside the issues over the current controversy for a moment, it seems that under Labour qualification for disability benefits had become something of a breeze and reform of the system was necessary and justified.